Swedish mortgage top-ups for renovation: 80% cap from 1 April 2026
With SEK 3,400,000 borrowed on a SEK 4,000,000 house you are at 85%. At 2% amortization it takes just under 3 years before the bank can lend more.
Since 1 April 2026, you can only raise your mortgage in Sweden if the loan-to-value ratio ("belåningsgrad") is at most 80% after the increase. With a house worth SEK 4,000,000 and SEK 3,400,000 in loans, you are at 85%.
You cannot borrow more for a renovation until the loan is below SEK 3,200,000.
What the law says
The new law on limits for home loans has two caps:
- When you buy a home, the loan can be at most 90% of its value.
- When an existing mortgage is increased, the loan-to-value ratio can reach at most 80%.
The Council on Legislation ("Lagrådet") sums it up in the government bill: a top-up loan ("tilläggslån") can only be granted if the loan-to-value ratio is below 80%. The law makes no exception for what the money is used for. A new kitchen counts as an increase, just like a car.
The value the bank uses
The bank does not use what your house is worth today. It uses the market value when you bought the home. As a rule, a new valuation is allowed five years after the purchase or after the last revaluation at the earliest.
There is one exception. If the home's value has changed a lot for a reason other than the general price trend, the bank may revalue earlier.
The bill gives examples: extensive renovation, conversion or extension. Renovating a single room or building a deck is generally not enough. What counts is the effect on market value, not what the work cost.
Worked example: how long you have to wait
The house was bought for SEK 4,000,000. The cap for a top-up loan is 80%, or SEK 3,200,000.
| Loan today | Loan-to-value | Above the cap | Amortization per year, 2% | Time to get below the cap |
|---|---|---|---|---|
| SEK 3,400,000 | 85% | SEK 200,000 | SEK 68,000 | just under 3 years |
| SEK 3,600,000 | 90% | SEK 400,000 | SEK 72,000 | over 5.5 years |
| SEK 3,100,000 | 77.5% | SEK 0 | SEK 62,000 | already below |
With SEK 3,100,000 in loans, you can borrow at most SEK 100,000 more. If you want a SEK 300,000 renovation, that is not enough.
Anyone who bought with a 90% loan after 1 April 2026 must pay off ten percentage points before the bank can raise the loan. At 2% a year, that takes several years.
How amortization and loan-to-value work over the life of the loan is explained in the living-with-a-mortgage chapter of our crash course.
Other ways to pay for the renovation
The government expected this. The bill says households above 80% without a savings buffer will need to borrow without security to carry out necessary repairs. There are a few options:
- Save first. This is the cheapest. Put the money you would have borrowed into a savings account.
- An unsecured loan ("blancolån"). The rate is normally higher than on a mortgage. From 2026, a loan without security gives no interest deduction ("ränteavdrag").
- Pay off extra. Every krona you pay off beyond the requirement brings you closer to 80%.
- Wait for a revaluation. If five years have passed since the purchase, a new valuation may give a higher value and more room.
What to do
- Find out which value the bank uses and when you bought the home.
- Work out 80% of that value and subtract your loans. That is your room to borrow.
- Ask the bank whether a revaluation is possible, if five years have passed or you have made major changes.
- Compare the cost of an unsecured loan with waiting and saving.
Sources
- Act (2026:226) on limits for home loans, Riksdag (in Swedish)
- Government bill 2025/26:119 on macroprudential policy, Riksdag (in Swedish)
- New law changes to help more people own their home, Government of Sweden (in Swedish)
- Interest deduction, Swedish Tax Agency (in Swedish)
This content is general information, not financial or legal advice. Bolån Radar collects data from banks and authorities and cannot guarantee that it is complete or free of errors. Talk to your bank or an adviser before you decide.